This matter is before the Authority on an exception to
the award of Arbitrator David Goodman. The issue before the Arbitrator was
whether the Agency's denial of the grievants' requests for permission to engage
in outside employment was arbitrary and unreasonable. The Arbitrator concluded
that the Agency violated the collective bargaining agreement when it denied the
grievants' requests, and ordered the Agency to provide each grievant with $600
to compensate for the breach of the agreement.

The Agency filed an exception under section 7122(a) of
the Federal Service Labor-Management Relations Statute (the Statute) and part
2425 of the Authority's Rules and Regulations. The Union filed an opposition to
the Agency's exception.

For the following reasons, we conclude that the award is
contrary to law. Accordingly, we will strike the portion of the award requiring
the Agency to provide each grievant with $600.

II. Background and Arbitrator's Award

The grievants are attorneys employed by the Agency in
Denver, Colorado. In early 1988, the grievants submitted separate requests to
the Agency for permission to engage in outside employment as hearing officers
for the Denver Civil Service Commission (DCSC). The Agency denied their
requests based upon concerns of conflicts of interest. Because the Agency
denied their requests, the grievants were not able to accept appointments as
hearing officers. A grievance was filed over the denial of the requests and,
when it was not resolved, the grievance was submitted to arbitration.

The parties stipulated the following issue before the
Arbitrator:

Was the Agency's denial of Grievants' requests for
permission to engage in outside employment arbitrary and unreasonable? If so,
what is the appropriate remedy.

Award at 4.

The Arbitrator concluded that "[t]he Agency violated
Article 4, Section 6 of the Agreement by acting in an arbitrary and
unreasonable manner in refusing Grievants' outside employment requests to serve
as hearing officers for DCSC." Id. at 32-33. The Arbitrator also
concluded that:

[t]he loss in compensation was caused by and was the
direct result of an Agency action in contravention of its commitment reflected
in Article 4, Section 6 of the negotiated Agreement. Having breached that
Agreement, and having knowledge and notice of the compensation which Grievants
could have received had their requests been honored, Grievants are entitled to
an appropriate make whole remedy.

Id. at 32.

The Arbitrator stated that the Union's suggestion that
"each Grievant would have been assigned three [DCSC] cases is a fair and
reasonable approach[,]" and that "[a]ssuming further that each case would have
been heard in one day or less, the contracted rate of $35 per hour would have
produced at least $600 in income for each Grievant." Id. Therefore, the
Arbitrator ordered as a remedy that each grievant receive "$600 in compensation
for breach of the Agreement." Id. at 33.

III. Agency's Exception

The Agency argues that the award is deficient because it
is contrary to the Back Pay Act, 5 U.S.C. § 5596. The Agency asserts that
the compensation awarded is not directly related to the contractual violation
and that it, therefore, does not meet the "butfor test."
Exception at 2 (emphasis in original). According to the Agency, the
Arbitrator's award constitutes an award of nominal damages and, as such, is
deficient.

IV. Union's Opposition

The Union asserts that the Arbitrator was authorized to
issue his award. Opposition at 2. The Union argues that because there was
sufficient evidence on the record to estimate the income which the grievants
would have earned if the Agency had not violated the parties' agreement, it is
"just and proper that the Agency should be required to make whole those
individuals that have been subject to its arbitrary and unreasonable acts."
Id.

V. Analysis and Conclusion

It is clear that, as asserted by the Union, arbitrators
have broad remedial authority. See, for example, American
Federation of Government Employees, Local 12 and United States Department of
Labor, 32 FLRA 771, 774 (1988). Nevertheless, awards of compensation under
the Statute must comply with the requirements of the Back Pay Act or be
authorized by some other clear expression of a waiver of sovereign immunity.
The Union asserts that, under the Back Pay Act, "an arbitrator may issue an
award granting outside earnings, as well as 'inside' earnings." Opposition at
2. The Union provides no support, and research fails to disclose any support,
for its assertion, however.

For an award of backpay to be authorized under the Back
Pay Act, the arbitrator must determine that: (1) the aggrieved employee was
affected by an unjustified or unwarranted personnel action; (2) the personnel
action directly resulted in the wi